The New Economic Policy was inaugurated in March 1921. It coincided with two events: the signing of the Anglo-Russian Commercial Agreement and the crushing of the Kronstadt uprising.  These two events are not only linked chronologically with the New Economic Policy; they also have an internal and structural link with it. The first event, the signing of the Anglo-Russian Commercial Agreement , shows very well why we did not resort to the New Economic Policy in 1920, after the victory over Kolchak and Denikin. After the victory over Kolchak and Denikin, the foremost European power, Britain, began to negotiate with us, but for over a year it dragged out the negotiations at length. During this time, Europe’s second capitalist power, France, mobilised Poland and Wrangel against us.  At the end of summer 1920 Wrangel was now officially recognised by France as the representative of the Russian government. Britain negotiated with us without even lifting her little finger to hinder French policy. British capital made the signing of a provisional commercial agreement drag on at great length, waiting for us to be vanquished eventually by the Poles and Wrangel, in order to be able to wash their hands innocently of us. Given that the New Economic Policy in part rests upon a compromise with world capital, it is clear that it was entirely suspended in mid-air for as long as the Anglo-Russian agreement had not been signed. Even today, many months after the signing of this accord, not a single important concessionary agreement has been concluded. All the contracts are at the stage of preliminary discussions. The famine this year awoke new hopes amongst the world bourgeoisie, and even that part of world capital that no longer hoped for our defeat waits before signing the agreements until the pressure of necessity is sufficiently strong for a compromise between it and us to be concluded in conditions most advantageous to it.
And what is the relationship of the Kronstadt events to the New Economic Policy? The Kronstadt events were only the echo of a deep process of fermentation amongst the peasant masses. They were the echo of the peasant uprisings in the Ukraine and at Tambov.  But what did these peasant uprisings mean? They showed that the imperialist war and the civil war had considerably weakened the rural economy. They showed that the Russian economic crisis had its origin not only in the disorganisation of industry, but also in the disintegration of its agriculture. They showed the necessity for a rapid and fundamental change in our policy; it had to take all the more an energetic and radical turn because the perspectives of a compromise with foreign capital were uncertain, and the course of the negotiations with foreign capital was dragging on at length. The agricultural crisis and the slowness of the negotiations with foreign coital have forced the Soviet government to alter the reconstruction plan that it had in view in spring 1920 after the defeat of Yudenich, Kolchak and Denikin. What did this plan consist of?
It rested on the hope of reinforcing economic relations with the foreign capitalist which were to help us obtain a mass of the means of production. In order to exploit this and to shorten the period of necessary preparatory work for using them, it was necessary to use the brute strength of the peasant masses in organisations of labour armies. Reconstruction had to begin with a frontal assault. Obviously this was not Communism, since we were prepared to rent out large sectors of industry to foreign capital. The outcries of the capitalist press and its Menshevik lackeys who were denouncing this as forced labour showed only the extent to which the bourgeoisie feared the rapid rhythm of economic construction in Russia. Given that this economic construction took account of the interests of both the workers and the peasants, the labour armies had nothing Communist about them. They were necessary measures which will be necessary every time the worker-peasant government has to achieve reconstruction at the most rapid rate. The plan ran aground to begin with because the labour armies, even before being organised, had to be militarily organised and equipped to fight against the Poles and Wrangel. It also got stuck because the foreign deliveries of the means of production were very slow. A frontal economic assault turned out to be impossible at the time. At the beginning of 1921 it became clear that economic reconstruction would only take place very slowly. World capital, which was incapable of overthrowing us, also showed itself incapable of concluding a rapid compromise with us. All these factors involved the necessity for a retreat, to the extent to which the Soviet government in 1920 dreamed of the rapid reconstruction of great statified industry thanks to the means of production provided by the foreigner and with the help of the strength of concentrated peasant labour. The essence of the New Economic Policy therefore consists in the Soviet government first of all mobilising the economic forces that will allow it to undertake Communist economic construction in the future.
65. The sailors in the Kronstadt fleet base rebelled against the Soviet government in March 1921, and were suppressed at the cost of some bloodshed.
66. A trade agreement was signed by the Soviet and British governments on 21 March 1921. It covered more than just economic relations between the two states, with clauses prohibiting both governments from carrying out hostile propaganda and activities in each other’s territories, the British Empire and independent countries that had been part of the Russian Empire.
67. Taking advantage of the Russian Civil War, the Poles advanced into the Ukraine in the spring of 1920, but their supply lines were over-extended, and the Russian army counter-attacked and invaded Poland. After the Russian defeat at the Battle of the Vistula, a peace treaty was signed at Riga in 1921. Coinciding with the Polish capture of Kiev, the White Guard Army of Baron Pyotr Wrangel (1878–1928) advanced from the south.
68. Apart from the nationalists, the south of the Ukraine was controlled by the Anarchist armies of Nestor Makhno for much of 1919–20; and there was a major peasant revolt against the Soviet government in Tambov in June 1920.
Last updated on 18.10.2011